Changing your company’s year end
There are special rules in place which limit your options to change your company’s year-end date. A company’s year-end date is also known as its ‘accounting reference date’ and is historically set by reference to the date the company was incorporated. Under certain circumstances it is possible to make a change to the year-end.
As a general rule, you can only change the year end for the current financial year or the one immediately before it. Making a change to a year-end ... read more
What is the Inheritance Tax residence nil rate band?
The Inheritance Tax residence nil-rate band (RNRB) came into effect on 6 April 2017. The RNRB is a transferable allowance for married couples and civil partners (per person) when their main residence is passed down to a direct descendent such as children or grandchildren after their death. The RNRB effectively increases your existing £325,000 inheritance tax nil-rate band.
The RNRB is being introduced in stages, the threshold is currently £150,000 and will increase to £175,000 ... read more
What is Capital Gains Tax incorporation relief?
If you own a business as a sole trader or in partnership, a Capital Gain will arise if your business is transferred into a company structure. The gain will be assessed by reference to the market value of the business assets, including goodwill, at the date of transfer. This could give rise to a chargeable gain based broadly on the difference between the market value of the assets and their original cost.
In most cases, the incorporation of the business will be completed so that incorporation ... read more
Overdrawn directors’ loans
An overdrawn Director’s Loan Account is created when a director (or other close family members) 'borrows' money from their company. Many companies, particularly 'close' private companies, pay the personal expenses of directors using company funds. Where these payments do not form part of a director’s remuneration, they are usually posted to the Director’s Loan Account (DLA).
The DLA can represent cash drawn by a director as well as other drawings by a director ... read more
When overseas companies need to register at Companies House
An overseas company must register with Companies House if they want to set up a place of business or branch in the UK. Generally, this would be if the overseas company had a physical presence in the UK through which it carries on business.
If an overseas company does not have a physical presence in the UK, they are not usually required to register with Companies House. For example, an independent agent who conducts business on behalf of an overseas company is not considered to have a physical ... read more
Objecting to a limited company being struck off
There are a limited range of circumstances when a company can request to be removed from the register (known as being struck off). For example, a voluntary strike off can be requested by a dormant or non-trading company.
You can object to a limited company’s application to be struck off the companies register if you’re a shareholder or other interested party, such as a creditor, and have a reason to stop the application, for example:
you have not been told about the ... read more
Post Brexit funding announced
The Chancellor is set to announce a new package of measures to help the UK prepare for a post-Brexit future. We are told that these measures will also help to support the next generation and promote economic growth.
It has also been confirmed that British organisations that are receiving certain EU funding, will continue to do so even after a no-deal Brexit. If the EU cease to fund UK organisations, the Government has guaranteed to commit funding. This will replace certain EU programme ... read more
Residential landlords’ tax changes complete April 2020
The tax relief on finance costs used to buy investment properties is being gradually restricted to the basic rate of tax. The full finance costs restriction will be in place from 6 April 2020. This means that from next April, all finance costs will be disallowed as expenses and any relief will be restricted to a basic rate tax credit.
Finance costs include interest on:
loans - including loans to buy furnishings
overdrafts as well as alternative finance sources
Costs also ... read more
Making a loss when you sell your home?
One of the most often used and valuable of the Capital Gains Tax (CGT) exemptions is Private Residence Relief, which usually exempts any profit made on the sale of a family home.
Consequently, there is no CGT on a property disposal that has been used solely as the main family residence. An investment property, which has never been used as a family residence, will not qualify for PRR.
However, an interesting counter point occurs if and when you make a loss on the sale of your home. You will not ... read more
Changes to off-payroll working from April 2020
The rules for individuals providing services to the public sector via an intermediary such as a Personal Service Company (PSC), changed from April 2017. The new rules shifted the responsibility for deciding whether the intermediaries’ legislation applies, known as IR35, from the intermediary to the public sector receiving the service.
In the 2017 Autumn Budget, the Government announced plans to extend these rules to off-payroll working in the private sector. The new rules come into effect ... read more